<article><p class="lead">Venezuelan production and export of hot briquetted iron (HBI) was suspended indefinitely this month after a fire destroyed the conveyor system at state-owned Sidor's 8mn t/yr pellet manufacturing complex in Bolivar state.</p><p>Sidor and state-owned iron mining company Ferrominera Orinoco have combined pellet production capacity of about 11mn t/yr, but Sidor's 4mn t/yr Line B pellet unit was Venezuela's only remaining partly operational facility until a fire overnight on 2 April destroyed the conveyor system.</p><p>The fire damaged Sidor's Line B pellet automated conveyor control system and also caused structural damage that cannot be repaired quickly, according to Sutiss steel union official Frank Oliveros. He blamed the fire on "mechanical failures" resulting from years of negligent maintenance.</p><p>It is still unclear how the fire started, but Oliveros said the pellets were already ablaze when they were deposited on the conveyor system.</p><p>Sidor's Line B pellet facility was producing about 40,000 tons of pellets per month or roughly 480,000 t/yr before the fire, he added. </p><p>Sidor has not produced any steel products for almost a year and is financially insolvent. There are no spare parts available locally to repair the conveyor system, and <a href="https://direct.argusmedia.com/newsandanalysis/article/2096724?keywords=sanctions%20venezuela">US and EU sanctions</a> imposed on the government of President Nicolas Maduro have made international equipment suppliers wary of doing any business with Venezuelan state companies, Oliveros said.</p><p>The office of economy vice president Tareck El Aissami, who since June 2018 oversees all of Venezuela's state-owned ferrous and non-ferrous metallurgical companies, declined to comment.</p><p>Venezuela's five state-owned HBI producers including Orinoco Iron, Venprecar, BriqVen, Comsigua and Ferrominera Orinoco have a combined installed capacity of 6.9mn t/yr which has been mostly off line since 2018. </p><p>Venezuela was formerly the world's largest HBI exporter, but HBI production has been mostly suspended since early 2018 due to a lack of pellets and electricity supply.</p><p>El Aissami's office declined to provide any current production figures, asserting that such information is classified.</p><p>Orinoco Iron has an installed capacity of 2.2mn t/yr and is able to manufacture HBI from iron ore fines, but parts and electricity supply shortages have reduced operational capacity to about 5pc, according to Sutiss union assessments of the steel sector's current problems.</p></article>
